MMTC Receives 'Hold' Rating Based on Technical Trend, Outperforms Market with 150.62% Return

MMTC, a midcap trading company, has recently received a 'Hold' rating from MarketsMOJO. This upgrade is based on the stock's technical trend, which has improved from Mildly Bullish to Bullish on July 2, 2024. The company's stock is currently in a Bullish range and has shown positive indicators such as MACD, Bollinger Band, KST, and OBV.
The majority shareholders of MMTC are its promoters, and the company has outperformed the market (BSE 500) with a return of 150.62% in the last year, compared to the market's 37.36% return. With a market cap of Rs 11,724 crore, MMTC is the largest company in its sector, accounting for 14.65% of the entire sector. However, its annual sales of Rs 5.34 crore only make up 0.01% of the industry.

Despite its strong market performance, MMTC is a high debt company with a Debt to Equity ratio (avg) of 6.45 times. Its long-term growth has also been poor, with net sales and operating profit declining at an annual rate of -82.15% and -198.98%, respectively, over the last 5 years. This is reflected in the company's low Return on Capital Employed (avg) of 3.83%, indicating low profitability per unit of total capital.

In the latest quarter, MMTC's results have been flat, with a PAT (9M) of Rs 175.55 crore, which is a decrease of -63.15% compared to the previous year. Additionally, the company's NON-OPERATING INCOME(Q) accounts for 94.60% of its Profit Before Tax (PBT), which could be a cause for concern.

The stock is currently trading at a risky level compared to its average historical valuations. While it has shown a strong return of 150.62% in the past year, its profits have declined by -55.8%. Investors should carefully consider these factors before making any investment decisions regarding MMTC.